|How strategic planning can actually produce results|
Many companies around the world will have started their annual strategic planning process, aimed at setting priorities, allocating resources and focusing on performance. The end-goal – a clear strategic plan which everyone in the organisation can understand – will often be the result of months of meetings and work, the application of countless methodologies, and a good deal of organisational introspection. For leaders and managers involved in the effort, it might all seem to consume a great deal of time.
Research by Bain & Company – “Strategic Planning that Produces Real Strategy” – aimed to gauge the opinions on the organisational planning process of almost 300 executives. It found that only 32 per cent of respondents believed that the strategic planning process their company engaged in was an “effective process with strong design, execution, and adaption”. It also showed that 34 per cent of those surveyed believed their approach was “ineffective”, while 20 per cent believed it produced a “poor strategy design”. Worse still, 8 per cent believed their strategy wilted under “poor execution”, while 5 per cent said there was “poor adaptation”.
One interesting facet of the research was that over 60 per cent of those surveyed still stated their satisfaction with the overall strategic planning process, despite the evident failings they had identified in it. The researchers argued that this might be because individual perceptions of what constitutes a “good strategy” might vary, but could as easily be because people have lowered their expectation of exactly what any strategic planning process can produce. In effect, their existing approach might be mediocre, but it also isn’t likely to get better.
Such a situation sounds pretty terminal for many companies if the hope is that strategic planning will produce greater results in the coming year. Repeating a tried and tested formula that has proven itself to be average at best, and ineffective and unsuitable at worst, is not going to turn a struggling business around. An important starting point is to recognise that an existing process isn’t necessarily producing the outcomes it should, and then looking at how a better approach can be customised to the unique requirements of an individual organisation. It’s not necessarily going to take the pain out of the planning process, but it can help ensure that the end result is worth the effort.
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